The head of research at the investment bank CI Capital, Moncef Morsi, said that what happened last week in terms of fluctuation in The exchange rate of the Egyptian pound against the dollar Naturally, with the central bank adopting a flexible exchange rate policy.
Moncef Morsi added, in an interview with Al-Arabiya, today, Sunday, that it is difficult with the start of this new system to determine the value or level of stability of the pound exchange rate, but the market will be more stable in the coming weeks and months with the application of a flexible exchange rate policy and the subsequent dollar flows. Expected, whether in agreement with global partners, investments or part of offering government assets.
He explained that in addition to these factors, the tightening monetary policy of the Central Bank will work to create a balance between the local and foreign currency.
Regarding foreign inflows into debt instruments last week, estimated at about $250 million, the head of research at the investment bank CI Capital said that the increase in foreign inflows into debt instruments at the beginning of each year is natural as the beginning of investors building their positions in this type of investment, but it came in conjunction With the announcement of a new economic reform program and the trend towards a flexible exchange rate and an increase in interest rates and returns on treasury bills and bonds, in light of a state of stability in the global economy, with the decline in the pace of increasing inflation levels in America.
Moncef Morsi explained that investing in debt instruments represents a source of financing the balance of payments, but with the government’s plan to diversify sources of foreign financing between direct investments, selling assets, increasing exports and raising the attractiveness of tourism, foreign investments in debt instruments will not be fundamentally dependent on them. The coming period, and the government will deal with it differently, and instead of collecting it on reserves, it will enter the “interbank” market.
Egypt had witnessed the exit of more than $20 billion in foreign hot money invested in debt instruments, with the outbreak of the Russian-Ukrainian crisis last February, and the raising of US interest rates over the past year.